Newton based communications company, Iowa Telecom, announced today it is being purchased by Windstream Corporation of Arkansas in a deal valued at $1.1 billion. Iowa Telecom director of corporate communications, Julie White, says the sale will allow the company to continue to compete in the highly competitive broadband market.
“As a public company it’s obviously our responsibility to create opportunities that are in the best long-term interest of our shareholders, for our customers, and we just determined that a transaction with Windstream really advanced our objectives in the longterm by providing a sufficient scale to compete, giving some stability in a highly competitive environment and really access to a broader market and a larger network for our customers,” White says.
Windstream is headquartered in Little Rock and operates in 16 states. Iowa Telecom provides phone, high-speed internet and digital TV to mostly rural areas of the state. White says the customers shouldn’t see any impact from the sale. She says they have approximately 256,000 access lines across the state.
The announcement of the sale says Windstream will maintain an operating presence in the Iowa Telecom headquarters building in Newton and plans to expand the existing Newton call center. White says it’s not known yet how the sale will impact the 800 Iowa Telecom employees.
She says they don’t have a lot of details yet, but Windstream will conduct a transition process with Iowa Telecom to evaluate the staffing needs and determine where they go from here. The sale involves stock, cash and the payment of about $598-million of Telecom debt, all which must be approved by regulators.
White says there is a set of regulatory approvals they must go through and they’ve heard it will probably not be completed until mid 2010. Iowa Telecom began operation in June of 2000 taking over the rural assets of several regional telephone companies. Iowa Telecom says it provides service to over 450 communities across Iowa.